Legislature releases sweeping probe of U athletics

When University of Utah basketball coach Larry Krystkowiak put the state’s holy war on hold for a year in January 2015, he pledged to pay the $80,000 cancellation fee to Brigham Young University.

And he has—in part. The U forked over the $80,000 to the Provo school, and the coach has given an initial chunk of $20,000 to his employer, according to a legislative audit of the University of Utah sports department released Tuesday afternoon. Administrators told auditors Krystkowiak was scheduled to pay in four installments over four years, the report says.

Krystkowiak paid the first chunk through his foundation, the audit found, so it’s unclear if the money was his own. But several university administrators told auditors that the coach assured them the money came from him and not donors.

It’s just one of a number of findings in the report out Tuesday afternoon. At the Capitol, members of the Legislative Audit Subcommittee spent over an hour reviewing the nitty-gritty of university inventory and hiring practices with auditors and U administrators. The lawmakers urged the U to tighten its bookkeeping but said they largely were pleased with the way the U handles its finances.

The U sports department is “remarkable” overall, but small oversights still needed to be addressed, said House Speaker Greg Hughes, R-Draper.

A panel of four legislative leaders ordered the review in February, less than a month after University of Utah canceled the December 2016 rivalry basketball game with Brigham Young University. Krystkowiak said the teams needed a cool-off period after BYU's Nick Emery punched U guard Brandon Taylor late in the Utes' December 2015 victory over the cougars. Krystkowiak stormed onto the court. Emery was thrown out of the game and later apologized.

Cougars Coach Dave Rose said he disagreed with the decision and was shocked. Scores of fans took to Twitter to express similar feelings, including Gov. Gary Herbert.

“Play the game,” Herbert tweeted. Still other Utahns and fans from other states wrote to legislators and to U President David Pershing to protest the hiatus.

Lawmakers at the time the review was ordered said the audit was not retribution for calling off the game that was last cancelled during World War II. The legislators insisted the review is a first step in a broader effort to understand how the state’s public universities run their sports departments as they reap more revenue than ever.

On Tuesday, the Legislative Audit Subcommittee was set to hear from the auditors and from the U in a meeting at the Capitol.

The U sports department, for its part, is accustomed to more superficial financial reviews. Like universities nationwide, the U reports general revenue and spending annually to the NCAA. But the probe released Tuesday delves deeper and broader into department practices, sometimes spanning decades.

Here’s what the audit found:

Pay for coaches: Most coaches’ salaries grew even though the majority of teams didn’t perform up to goals set by the department. But administrators said they need to offer raises in order to retain coaches. At the same time, auditors found, coaches weren’t always aware of what the expectations were.

Under-reporting financial support from the school: The department has under-reported how much revenue it got from the school for “several years,” though the report’s authors didn’t say for how long. Last year, the department reported receiving about $10.2 million from the university and from student fees. About $1.1 million in indirect fees, such as employee benefit and discounts on renting school offices and buildings were missing, auditors said. U Athletic Director Chris Hill said NCAA officers told his staff the oversight was not a violation of the national group’s policy.

Less consideration for smaller sports: The athletic director can get raises if men’s and women’s basketball, football and gymnastics improve, but there’s no explicit focus on smaller sports such as field hockey and baseball. Nine schools in the Pac-12 have some kind of incentive for athletic directors to drive success of all teams, not just the money-making ones.

Hiring: The department has occasionally bypassed hiring protocol, auditors said, appearing to give preferential treatment. The department made “questionable” use of a temporary waiver that allows employees to work for a five-month period. An employee who got the waiver still was working there three years later and never went through the traditional hiring process, the report found. The department also brought on contractors “without sufficient HR involvement.” And some employees’ job descriptions didn’t correspond to their salaries, the audit found.

Expensive equipment and thefts: The review found that the department hasn’t been keeping track of about $2 million in purchases between $1,000 and $5,000, such as laptops, big-screen TV’s and video production equipment. It’s a concern because there have been thefts and lapses in security across the department.

Economic impact of joining the Pac-12: Revenues have gone up, but so has spending. The department brought in just under $64 million in revenue in 2015, compared to about $31 million in 2010. But the office is still $4.7 million in the red after spending more on coaches’ salaries after joining the conference in 2011. Still, it’s faring better than four other schools in the conference, which range from a $20 million deficit (University of Colorado at Boulder) to $50 million (Washington State University).

Here’s what the U says in response: The department already is working to clean up its bookkeeping and has a university human resources officer embedded in the department. Two employees, the U added in a response, are no longer employed there after stealing equipment.

“We can see positive benefits for the university as a whole and certainly for the department of athletics,” U President David Pershing said. "Our plan is to do just what was asked."

“We feel the audit has really reflected on how we can improve,” Hill added. Krystkowiak did not have a response to the report Tuesday evening, Hill said.

Here’s what else auditors recommended: In-depth financial reporting, including a detailed digital database that identifies money flowing in and out of the office, as well as figures reported to the NCAA. The audit recommends the university provide more detailed reports to policymakers.A followup audit is scheduled for next year.

Praise: The review found the U’s teams on average got better grades than their opponents at other schools. Said Rep. Brian King, D-Salt Lake City: “I am enormously impressed.”